Method and system for facilitating online payments based on an established payment agreement

ABSTRACT

A method and system for facilitating online payments are disclosed. According to one aspect of the present invention, a payment agreement is established at a payment service provider that defines terms of a payment relationship between a merchant and a user. The establishing of the payment agreement includes linking the payment agreement with a payment account of the merchant or user stored at the payment service provider. After establishing the payment agreement, a payment request associated with a transaction is received, whereby the payment request includes a unique identifier to identify the payment agreement stored at the payment service provider. Based on a verification that the payment request complies with terms of the payment agreement, the payment request is processed.

RELATED APPLICATIONS

This application is a continuation of U.S. application Ser. No.15/091,199, filed Apr. 5, 2016, and issues Apr. 10, 2018 as U.S. Pat.No. 9,940,622, which is a continuation of U.S. application Ser. No.13/458,855, filed Apr. 27, 2012, now issued as U.S. Pat. No. 9,317,841,which is a continuation of U.S. application Ser. No. 10/873,704 filedJun. 21, 2004, now issued as U.S. Pat. No. 8,175,938, and claims thebenefit of the filing date of U.S. Provisional Patent Application No.60/562,065, filed Apr. 13, 2004, all of which are incorporated in theirentirety herein by reference.

FIELD OF THE INVENTION

The present invention relates generally to commerce automation. Moreparticularly, the present invention relates to a method and system forfacilitating online payments based on an established payment agreement.

BACKGROUND OF THE INVENTION

Electronic commerce (“e-commerce”) has been increasing in popularity asmore people are becoming accustomed to purchasing products online viathe Internet. Such purchases can be facilitated through the use of athird-party, online payment service, such as the PayPal® online paymentservice, provided by PayPal® of San Jose, Calif. One problem withexisting online payment services is that the customer must navigate awayfrom the merchant's website to make a payment. For example, the customermust login to the payment service provider's website for each onlinepayment the customer makes. The extra time spent logging into andnavigating the payment service provider's website to make a payment isinconvenient, particularly when the purchase involves a small amount ofmoney.

BRIEF DESCRIPTION OF THE DRAWINGS

The present invention is illustrated by way of example, and not by wayof limitation, in the figures of the accompanying drawings, in whichlike references indicate similar elements, and in which:

FIG. 1 is an exemplary client-server network diagram illustrating therelationship between a client PC, a merchant server and a paymentservice provider server, for one embodiment of the present invention;

FIG. 2 illustrates a web-based flow, for one embodiment of theinvention, of a method of initiating a payment relationship with amerchant for merchant-initiated “pull” payments;

FIG. 3 illustrates an example of a web page for customizing the fundingsources of a merchant-initiated payment relationship;

FIG. 4 illustrates an example of a web page for customizing amerchant-initiated payment relationship;

FIG. 5 illustrates a system to facilitate merchant-initiated electronicpayments.

FIG. 6 shows a diagrammatic representation of a machine in the exemplaryform of a computer system within which a set of instructions, forcausing the machine to perform any one or more of the methodologiesdiscussed herein, may be executed.

DETAILED DESCRIPTION

A method and system for facilitating merchant-initiated online paymentsare described. In the following description, for purposes ofexplanation, numerous specific details are set forth in order to providea thorough understanding of the present invention. It will be evident,however, to one skilled in the art that the present invention may bepracticed without these specific details.

The present invention provides several advantages over prior paymentmethods and systems. In particular, the present invention provides acustomer with a simpler and faster way to transact with merchants.According to one embodiment of the present invention, a customerinitiates a merchant-initiated payment relationship with a merchant bynavigating a series of web pages and providing the necessary informationto establish the payment relationship. Once the payment relationship isin place, the customer can purchase goods and/or services from themerchant with the ease and simplicity of a single click to authorize apayment. Other features and advantages of the present invention will beapparent from the detailed description that follows.

FIG. 1 illustrates an example of a client-server network environment 24in which the present invention might be implemented. In accordance withone embodiment of the present invention, and as illustrated in FIG. 1, apotential customer, or buyer, uses a client personal computer (PC) 26connected to a network (e.g., the Internet 28) to interact with amerchant server 30 and a payment service provider's server 32. Theclient PC 26 will generally execute client software such as a web client(e.g., a browser, such as the Internet Explorer browser developed byMicrosoft Corporation of Redmond, Wash. State) that enables the customerto browse web pages on the World Wide Web. In FIG. 1, the client 26 isillustrated as a PC. However, it will be appreciated that the client 26could be any type of computing device including, but not limited to, alaptop, a handheld digital assistant, a mobile phone, or a point-of-saleterminal.

The merchant server 30 executes Internet server software including, butnot limited to, web server software and Application Program Interface(API) server software. The web server software executing on merchantserver 30 serves web pages to web clients, such as a web browserexecuting on client 26. The web pages provide an interface to a virtualstore that customers can browse with the web browser software. Whilebrowsing the virtual store, customers can select items to purchase. Themerchant server 30 temporarily stores items selected for purchase, whichcan be accessed for checkout by selecting a link to a virtual shoppingcart.

The payment service provider's server 32 is connected to the client PC26 and the merchant server 30 via the Internet 28. Like the merchantserver 30, the payment service provider's server 32 also executesInternet server software including, but not limited to, web serversoftware and API server software. For one embodiment of the presentinvention, to process a payment for the customer's selected items, themerchant server 30 interacts with the payment service provider's server32 via an API protocol. For example, the API server software provides aprogrammatic interface allowing the merchant server 30 and the paymentservice provider's server 32 to communicate using standardized APIcalls. According to one embodiment of the present invention, a softwaredevelopment kit may be provided to each merchant that offers itscustomers the option to pay via the payment service provider.Consequently, before a customer enters into a payment relationship witha merchant, the merchant will generally already have established arelationship of its own with the payment service provider, and themerchant will have integrated the API functionality into its merchantserver 30 to communicate with the payment service provider's server 32.

Entering into a Merchant-Initiated Payment Relationship

FIG. 2 illustrates a web-based, sign-up flow for a payment relationship,for one embodiment of the present invention. Each of the actions, oroperations, illustrated in FIG. 2 is presented in association with adifferent web page that is presented to the customer. However, it willbe appreciated that each of the actions is only an example, and thatmultiple actions or operations could be combined or separated to occurin connection with one or more web pages presented to the customer.

For purposes of the invention, a merchant is any person or entity thatis set up to receive payments in exchange for goods or services. Forexample, a merchant may include any seller, vendor, retailer, or personinitiating an auction for goods or services. Once a customer hasestablished an account, or signed up, with the merchant 36 and hasselected goods and/or services to purchase, the customer may bepresented with several payment options. For example, if the customer hasa pre-existing merchant-initiated payment relationship with themerchant, the customer may be presented with the option to make apayment via the payment service provider using a merchant-initiatedpayment, the details of which will be described in detail below.However, if the customer does not yet have an existingmerchant-initiated payment relationship with the merchant, the customerwill be presented with an option to establish a merchant-initiatedpayment relationship with the merchant by selecting a “sign-up” buttonor link, directing the customer to the website of the payment serviceprovider.

For one embodiment of the present invention, the communication betweenthe merchant server 30 and the payment service provider server 32 is viaAPI calls with standardized variables. For example, when the customerselects to establish a merchant-initiated payment relationship with themerchant 38 by clicking a “sign-up” link on the merchant's website, anAPI call is made from the merchant server 30 to the payment serviceprovider server 32, requesting the establishment of a merchant-initiatedpayment relationship. In connection with the request, one or more dataitems may be communicated to the payment service provider server 32. Thedata items may include, but are not limited to the following:

DATA ITEM NAME DATA ITEM DESCRIPTION BILLING_AGREEMENT_ID A uniqueidentification number for the payment relationship or billing agreement.MERCHANT_NAME The name of the business and/or an email address for thebusiness. SERVICE_DESCRIPTION A brief description of the goods orservice within the scope of the merchant-initiated payment relationship.PAYMENT_TYPE The type of payment required by the merchant. TEST_AMOUNT Acurrency amount to be tested against the customer's account.CURRENCY_CODE The default currency accepted by the business. MAXIMUM Adefault maximum currency amount authorized by the customer to be chargedagainst his virtual wallet per month. MAXIMUM_EDIT A binary value thatindicates whether the maximum amount is customizable by the customer.MINIMUM A minimum amount that the customer will be charged per month.IPN_URL A server-to-server communication providing instant paymentnotifications.

For one embodiment of the invention, the merchant server 30 may encryptthe data items before communicating the data items to the paymentservice provider's server 32. Additionally, for security reasons, themerchant server 30 may digitally sign the message associated with theAPI call so that the payment service provider's server 32 can verify theauthenticity of the message when it is received.

After the customer has selected to establish a merchant-initiatedpayment relationship 38 with the merchant, the customer is redirected toa payment relationship initiation web page 40 hosted by the paymentservice provider's server 32. If, for example, the customer has apre-existing account with the payment service provider, the customer maybe asked to verify his identity by submitting the user credentials(e.g., username and/or password) associated with the customer's existingaccount. However, if the customer does not have a pre-existing accountwith the payment service provider, the customer may be asked to providea username and password, as well as other information, to establish anaccount and to identify the customer as the holder of the account withthe payment service provider.

In either case, the customer is presented with information about themerchant and the terms of the merchant-initiated payment relationshipagreement with the payment service provider. For example, the terms ofthe agreement may be directly related to the data items communicatedfrom the merchant server 30 to the payment service provider server 32.The terms may include the name of the payee to which payments will bemade on behalf of the customer and the exact nature of the goods and/orservice for which the customer authorizes the payment service providerto make payments. In addition, the agreement terms may include a defaultmaximum or minimum amount that the customer authorizes to be paid to themerchant over a particular time period. For example, the agreementunderlying the payment relationship may dictate that the payment serviceprovider, on behalf of the customer, is authorized to paymerchant-initiated payment requests for a particular dollar amount permonth. If the customer agrees with the terms of the agreement, thecustomer may indicate so, by clicking on a particular link, or button.In response, the customer may be presented with a web page confirmingthe establishment of the merchant-initiated payment relationship 44.

As will be discussed in greater detail below, the customer may bepresented with the option to add, delete or customize funding sources 46for the merchant-initiated payment relationship. For example, thecustomer may be given the option to add a new account (e.g., bankaccount or credit card account) to the customer's virtual wallet. Inaddition, the customer may be presented with the option to customize theterms of the payment relationship.

Authentication or Verification of Customer's Online Wallet Account

For one embodiment of the present invention, the merchant may process atest transaction against a customer's account (e.g., the customer'sonline wallet) during the establishment of the merchant-initiatedpayment relationship, or alternatively, at later time, for example, whenthe customer requests a payment. For example, for one embodiment of theinvention, the merchant server 30 may communicate a test amount variableto the payment service provider server 32 along with a request toestablish a merchant-initiated payment relationship. The payment serviceprovider server 32 receives the test amount variable, and processes averification payment using the payment service model. As a verificationpayment, the payment is processed for test purposes only, and notactually charged to the customer's account.

For one embodiment of the invention, the payment service provider server32 communicates a response to the merchant server 30 indicating whetheror not the test amount was successfully processed. For example, theresponse may be binary in nature, indicating a simple “yes” or “no.” Forone embodiment of the invention, if the test amount failed for somereason, an explanation for the failure is communicated to the merchantserver 30 along with the response. For example, if the test failsbecause the customer's account has been restricted, or if the testamount exceeds the customer's available funds, or for any other reason,an explanation indicating the reason for the failure may be included inthe response to the merchant server 30.

One advantage of the account verification procedure is that it allows amerchant to receive a simple binary response, for example, success orfailure. This reduces the complexity of the logic required by other morecomplicated fraud scoring models. Additionally, in contrast to somecredit card account verification procedures, a successful verificationof the test amount is not synonymous with a guarantee of payment. Theverification procedure is time sensitive in the sense that success orfailure depends on the status of the customer's account at the time thetest is run.

API for Making Merchant-Initiated Payment Requests

After a customer has established a merchant-initiated paymentrelationship with a particular merchant, the customer can transact withthe merchant with the simple click of a button or link. For example,once a customer has selected one or more goods and/or services topurchase from a merchant's online store, the customer may select a linkto pay via the payment service provider, using the establishedmerchant-initiated payment relationship.

When the customer selects the link to use the merchant-initiated paymentmethod, the merchant server 30 makes an API call to the payment serviceprovider server 32 requesting a payment 52. For one embodiment of theinvention, the request may include a number of data items related to thetransaction. For example, for one embodiment of the invention, the dataitems may include, but not be limited to:

DATA ITEM NAME DATA ITEM DESCRIPTION BILLING_AGREEMENT_ID A uniqueidentification number for the payment relationship or billing agreement.AMOUNT The currency amount of the payment requested. PAYMENT_TYPE Thetype of payment required by the merchant. TEST_AMOUNT A currency amountto be tested against the customer's account. CURRENCY_CODE The defaultcurrency accepted by the business. TAX The currency amount of tax to becharged. SHIPPING The currency amount to be charged for shipping.HANDLING The currency amount to be charged for handling.ITEM_DESCRIPTION A description or identification number of the itempurchased. ITEM_NUMBER The number of items purchased.

For one embodiment of the invention, the merchant server 30 may encryptthe data items related to the transaction before communicating the dataitems to the payment service provider's server 32. Additionally, forsecurity reasons, the merchant server 30 may digitally sign the messageassociated with the API call so that the payment service provider'sserver 32 can verify the authenticity of the message when it isreceived.

In response to the payment request, the payment service provider server32 validates and processes the request. For one embodiment of theinvention, the payment service provider server 32 performs severalvalidation routines when it receives a payment request. For example, thepayment service provider server 32 may validate the variables passed inby the merchant server 30 to ensure that all the required data has beenreceived and is in the proper format. In addition, the payment serviceprovider server 32 may ensure that the payment request is within thescope of the merchant-initiated payment relationship. For example, thepayment service provider server 32 may ensure that the amount billeddoes not exceed a maximum amount that the customer has authorized formerchant-initiated payments under a merchant-initiated paymentrelationship with that particular merchant.

After validating the request, the payment service provider server 32processes the request. For one embodiment of the invention, the paymentservice provider server 32 performs several routines when processing therequest. For example, the payment service provider server 32 may analyzeor calculate a shipping profile and/or tax profile for the transaction.Additionally, the payment service provider server 32 may perform afunding source analysis to select the proper funding source for thetransaction. For example, the customer may have selected a preferredfunding source for the particular merchant-initiated paymentrelationship. If so, the payment service provider server 32 may attemptto process the transaction using the preferred funding source beforefalling back to a default funding source.

For one embodiment of the invention, the payment service provider server32 always attempts to process the transaction with funds held in anaccount with the payment service provider (e.g., an internally heldaccount), and only uses a customer-selected preferred or secondaryaccount (e.g., an externally linked account, such as a bank or creditcard account) if there are insufficient funds in the internally heldaccount. For one embodiment of the invention, the payment serviceprovider server 32 will continue attempting to process the payment ifthe transaction is unsuccessful using one or more accounts. For example,the payment service provider server 32 will proceed to use accounts, ina default order, or an order specified by the customer, to attemptprocessing the transaction until it has been unsuccessful with everyaccount in the customer's virtual wallet. At that time, the paymentservice provider server 32 will communicate a failure message to themerchant server 30 via an API call. The API call may specify the reasonfor the failure.

In an alternative embodiment, the payment service provider server willreport a failure to the merchant server 30 after a first attempt toprocess the transaction has failed. The message to the merchant server30 may indicate a reason for the failure, and the merchant server 30 mayrequest a second attempt using a different account, or combination ofaccounts in the virtual wallet.

In any case, the response communicated to the merchant server 30 issynchronous in nature. In addition to a synchronous response, thepayment service provider server 32 may communicate an asynchronousresponse. For example, an instant payment notification (IPN) may becommunicated to the merchant server 30 at a later time if, for example,the synchronous response was not communicated due to a network problem,or, if there was a delay in processing the payment using a particularaccount.

Another advantage of the API is the ease with which it can beimplemented by a third party. For example, for one embodiment of theinvention, a third-party may implement the API to provide paymentprocessing on behalf of the merchant. The API allows the third party toseamlessly integrate payment processing for the merchant with limitedwork and adaptation from the merchant.

Selection of the Funding Source for Payments

One of the advantages of the present invention is that the customer isprovided with significant flexibility in customizing funding sources forpayments on a per merchant basis. For example, for eachmerchant-initiated payment relationship the customer enters into, thecustomer has the ability to customize the funding source to be used forpaying that particular merchant. This flexibility allows the customerto 1) select different funding sources for different merchants, 2)select preferred funding sources for particular merchants, and/or 3)disable funding sources for particular merchants.

For one embodiment of the invention, the customer may be presented witha funding source customization web page, such as the example web pageillustrated in FIG. 3. The funding source customization web page 62 maybe presented to the customer at the time the merchant-initiated paymentrelationship is established, as illustrated by the web-based action withreference number 46 in FIG. 2. Alternatively, the funding sourcecustomization web page 62 may be accessed via the payment serviceprovider's home website at a later time as part of a profile setting forthe customer.

The funding source customization web page 62 allows the customer toselect a preferred funding source (e.g., bank, credit card, or otheraccount) from which payments should be processed for transactions withthe merchant that are associated with the merchant-initiated paymentrelationship. In addition, the customer may disable certain fundingsources for a particular merchant-initiated payment relationship. Forone embodiment of the invention, the customer is given the option ofranking or ordering all the accounts in the customer's virtual wallet.Furthermore, for one embodiment, the payment service provider server 32may select a certain account as the default account and always attemptto use this default account first.

Customer's Customization of the Merchant Agreement

One advantage of the present invention is the control that the customeris provided in relation to customizing the payment relationship. Forexample, not only can the customer control the funding sources on a permerchant basis, as described above, but the customer is also given theability to set maximum payment amounts on a per merchant basis. Forexample, the customer may set a maximum payment amount that a particularmerchant can charge under a merchant-initiated payment relationship.

For one embodiment of the invention, the customer may be presented witha payment relationship customization web page 64, such as the exampleweb page illustrated in FIG. 4. The payment relationship customizationweb page 64 may be presented to the customer at the time themerchant-initiated payment relationship is established, as illustratedby the web-based action with reference number 48 in FIG. 2.Alternatively, the payment relationship customization web page 64 may beaccessed via the payment service provider's home website at a later timeas part of a profile setting for the customer.

For one embodiment of the present invention, the customer is able to setmaximum payment amounts on a monthly basis per merchant-initiatedrelationship, as illustrated in FIG. 4. For example, for one embodimentof the invention, the customer is able to set a maximum dollar amountthat the payment service provider is authorized to pay a particularmerchant in a given month, on behalf of the customer. Alternatively, themaximum amount could be for a given time period other than a month, forexample, a maximum per week, quarter, or year. In addition, for oneembodiment of the invention, the customer is able to set a maximumpayment amount for a single transaction and/or a maximum number oftransactions for a given time period. For example, for a specificmerchant-initiated payment relationship, the customer might select toset the maximum number of transactions in a given month to five, themaximum payment amount for any single transaction to $50, and themaximum payment amount for a single month to $200. Consequently, thecustomer is given great flexibility

For one embodiment of the invention, each merchant determines whetherthe customer should have control over setting any maximum amounts. Forexample, as illustrated in FIG. 4, merchant 2 does not allow a maximumamount to be controlled by the customer.

Merchant Notifications

Another advantage of the present invention is the merchant notificationsthat are communicated asynchronously from the payment service provider'sserver to each merchant server 30. For example, as illustrated in FIG.2, the payment service provider server 32 may on occasion communicatemessages 56 to a merchant server 30 with updates on the status of aparticular merchant-initiated payment relationship. Additionally, themerchant server 30 may request verification 58 of a particularnotification message that the merchant server 30 receives. For example,if a customer closes his account with the payment service provider, thepayment service provider server 32 may notify the merchant server 30.Consequently, the merchant server 32 will be able to discontinuepresenting the payment service provider as a payment option at themerchant's checkout web page for the customer. In addition,notifications may be sent to the merchant server if, for example, alinked account (e.g., a credit card account) in the customer's virtualwallet expires or is otherwise cancelled.

FIG. 5 illustrates a system 64, consistent with one embodiment of theinvention, to facilitate merchant-initiated electronic payments. Thesystem includes an Application Programming Interface (API)communications module 66, a merchant-initiated payment relationshipmanagement module 68, a payment processing module 70, and an accountsdatabase 72. For one embodiment of the invention, the system receivesrequests to establish merchant-initiated payment relationships, oragreements, as well as requests for payment under previously establishedrelationships, or agreements.

Using one of a variety of standardized protocols, the API communicationsmodule 66 receives API messages from a merchant server. The API messagesmay include any number of pre-defined data items, such as those in thecharts shown above with respect to the description of FIG. 2. For oneembodiment of the invention, after receiving an API message, the APIcommunications module authenticates, decrypts and verifies the message.

For example, for one embodiment of the invention the API communicationsmodule includes an authentication and encryption module 74 that mayauthenticate and decrypt the message. For example, the authenticationand encryption module 74 may check a digital signature included with themessage to determine whether the message is from a trusted source, suchas a merchant server with a proper digital signature key. Next, theauthentication and encryption module 74 may decrypt the message, if themerchant server that sent the message originally encrypted it.

Next, a data verification module 76 may verify the data items includedin the message. For example, if the message is a request to establish amerchant-initiated payment relationship, then the data verificationmodule 76 may verify that the request includes all of the data itemsrequired for such a request. Furthermore, the data verification module76 may verify that the data items received with the request are of theproper type and format. For example, the data verification module 76 maycheck a data item to determine whether it is a number or character, andwhether it has the proper length. If a data field is invalid for anyreason, the API communications module 66 may reject the message and/orsend a reply message notifying the sender of the original message thatone or more data items were invalid.

For one embodiment of the present invention, the merchant-initiatedpayment relationship management module 68 manages the formation andadministration of merchant-initiated payment relationships and accountsto which each relationship is linked. For example, the management module68 processes requests to establish new merchant-initiated paymentrelationships, and links each established relationship to the account ofa payment service provider account holder. For example, as illustratedin FIG. 5, an account holder may establish several merchant-initiatedpayment relationships with a wide variety of merchants. The managementmodule 68 establishes each merchant-initiated payment relationship andlinks the data associated with each relationship to the account data 78associated with the user's account held in an accounts database 72.

In addition, for one embodiment of the invention, the management module68 includes a funding source customization module 80 and a paymentcustomization module 82. The funding source customization module 80allows a user to customize a funding source for a particularmerchant-initiated payment relationship. For example, for one embodimentof the invention, the funding source customization module 80 facilitatesthe adding and deleting of funding sources for a user account ormerchant-initiated payment relationship. Furthermore, the funding sourcecustomization module 80 may facilitate the presentation of fundingsources to a user, and the reception of funding source selections fromthe user, including a preferred funding source (e.g., a particular bankaccount or credit card account) selected by a user. Consequently, when apayment request is received under a particular merchant-initiatedpayment relationship and processed, the payment processing module 70will attempt to use funding sources in the order specified by the user.

For one embodiment of the invention, the management module also includesa payment customization module 72. The payment customization modulefacilitates the customization of terms of the merchant-initiated paymentrelationships. For example, the payment customization module 82 providesthe logic to present users with the option of setting maximum paymentamounts. For one embodiment of the invention, the payment customizationmodule customizes the payment relationship on a per merchant basis, byproviding the user with the ability to set a maximum payment amount pertransaction, or a maximum payment amount for a predetermined period oftime (e.g., maximum total payments per a given month). Additionally, thepayment customization module may provide the user with the ability tolimit the total number of payment requests that are processed for aparticular merchant in a given time period. For example, the user may beable to limit a merchant to making one payment request per month.

Prior to processing a payment in connection with a payment request, thepayment processing module 70 may perform a verification process toverify that the user has properly authorized a payment in connectionwith the particular terms of a payment request. For example, theauthorization verification module 84 of the payment processing module 70may verify that the payment processor has been properly authorized bythe user to make a payment in connection with the payment request. Inaddition to checking or verifying payment limits set by the user usingthe payment customization module 82, the authorization verificationmodule 84 may verify that the particular product or service associatedwith the payment request received from the merchant is a product orservice that has been authorized for merchant-initiated payments underthe merchant-initiated payment relationship.

FIG. 6 shows a diagrammatic representation of a machine in the exemplaryform of a computer system 300 within which a set of instructions, forcausing the machine to perform any one or more of the methodologiesdiscussed herein, may be executed. In alternative embodiments, themachine operates as a standalone device or may be connected (e.g.,networked) to other machines. In a networked deployment, the machine mayoperate in the capacity of a server or a client machine in server-clientnetwork environment, or as a peer machine in a peer-to-peer, ordistributed, network environment. The machine may be a server computer,a client computer, a PC, a tablet PC, a set-top box (STB), a PersonalDigital Assistant (PDA), a cellular telephone, a web appliance, anetwork router, switch or bridge, or any machine capable of executing aset of instructions (sequential or otherwise) that specify actions to betaken by that machine. Furthermore, while only a single machine isillustrated, the term “machine” shall also be taken to include anycollection of machines that individually or jointly execute a set (ormultiple sets) of instructions to perform any one or more of themethodologies discussed herein.

The exemplary computer system 300 includes a processor 302 (e.g., acentral processing unit (CPU) a graphics processing unit (GPU) or both),a main memory 304 and a static memory 306, which communicate with eachother via a bus 308. The computer system 300 may further include a videodisplay unit 310 (e.g., a liquid crystal display (LCD) or a cathode raytube (CRT)). The computer system 300 also includes an alphanumeric inputdevice 312 (e.g., a keyboard), a cursor control device 314 (e.g., amouse), a disk drive unit 316, a signal generation device 318 (e.g., aspeaker) and a network interface device 320.

The disk drive unit 316 includes a machine-readable medium 322 on whichis stored one or more sets of instructions (e.g., software 324)embodying any one or more of the methodologies or functions describedherein. The software 324 may also reside, completely or at leastpartially, within the main memory 304 and/or within the processor 302during execution thereof by the computer system 300, the main memory 304and the processor 302 also constituting machine-readable media. Thesoftware 324 may further be transmitted or received over a network 326via the network interface device 320.

While the machine-readable medium 392 is shown in an exemplaryembodiment to be a single medium, the term “machine-readable medium”should be taken to include a single medium or multiple media (e.g., acentralized or distributed database, and/or associated caches andservers) that store the one or more sets of instructions. The term“machine-readable medium” shall also be taken to include any medium thatis capable of storing, encoding or carrying a set of instructions forexecution by the machine and that cause the machine to perform any oneor more of the methodologies of the present invention. The term“machine-readable medium” shall accordingly be taken to include, but notbe limited to, solid-state memories, optical and magnetic media, andcarrier wave signals.

Thus, the present invention provides a method and system forfacilitating merchant-initiated online payments. Accordingly, a merchantis provided with the means to “pull” funds from a customer's accountwith a payment service provider on an as-needed basis, as opposed to aregular schedule as with a subscription-type service. Before themerchant is allowed to “pull” funds from the customer's account, thecustomer will first indicate that the customer would like to establishthe merchant-initiated payment relationship with the merchant, via aseries of web pages hosted by the payment service provider. The abilityto customize the payment relationship agreement on a per merchant basisprovides the customer with a certain level of security and protection.For example, the customer is allowed to set preferred funding sourcesand set maximum payment amounts (e.g., maximum dollars per month, or pertransaction) on a per merchant basis. This customization is advantageousto the customer because it protects the customer from potential fundsoverdrafts and credit limit overruns. Additionally, the customizationfeature is beneficial to the merchants because it limits the likelihoodof disputes and chargebacks.

Thus, a method and system are provided with reference to specificexemplary embodiments. It will be evident that various modifications andchanges may be made to theses embodiments without departing from thebroader spirit and scope of the invention. Accordingly, thespecification and drawings are to be regarded in an illustrative ratherthan a restrictive sense.

What is claimed is:
 1. A method comprising: receiving, at a paymentservice provider server of a payment service provider that is distinctfrom a merchant server of a merchant, a payment request associated witha transaction between a user and the merchant, the payment request beingreceived from the merchant server in response to the user making aparticular user selection on a user interface of a merchant siteprovided by the merchant server; and automatically and without requiringuser intervention, processing, by the payment service provider server,the payment request to cause transfer of funds to a merchant account,the receiving of the payment request and the processing of the paymentrequest both being in response to the particular user selection andbeing performed on the user interface of the merchant site withoutdirecting the user to a service provider site of the payment serviceprovider such that the payment request is received and processed by thepayment service provider server based on user interaction with themerchant site instead of being based on user interaction with theservice provider site.
 2. The method of claim 1, wherein the methodfurther includes: verifying, by the payment service provider server,that the payment request complies with terms of a payment agreementestablished between the merchant and the user; and wherein theprocessing of the payment request is in response to verifying that thepayment request complies with the terms of the payment agreement.
 3. Themethod of claim 2, further comprising identifying the payment agreementfor the verifying using a unique identifier included in the paymentrequest.
 4. The method of claim 2, wherein the payment agreement definesterms including an authority granted by the user to the payment serviceprovider to make payments to the merchant on behalf of the user.
 5. Themethod of claim 2, wherein the verifying that the payment requestcomplies with the terms of the payment agreement includes performing oneor more verification operations selected from a group of verificationoperations consisting of: verifying that processing the payment requestdoes not exceed an authority granted by the user; verifying thatprocessing the payment request would not exceed a maximum payment amountset by the user; verifying that processing the payment request would notexceed a maximum number of payment requests processed over apredetermined time period; verifying that the payment request is inconnection with a product or service for which the payment serviceprovider is authorized to make a payment; and verifying that the paymentrequest is in connection with a product or service for which the paymentservice provider is authorized to make a payment.
 6. The method of claim2, further comprising: receiving, at the payment service provider servera relationship request to establish, at the payment service providerserver, the payment agreement between the merchant and the user prior toany transactions between the merchant and the user; and establishing thepayment agreement between the merchant and the user, the establishing ofthe payment agreement comprising linking the payment agreement with oneor more accounts selected from a group of accounts consisting of: themerchant account of the merchant; and a user account of the user.
 7. Themethod of claim 6, wherein the relationship request is received inresponse to a selection by the user of a link to establish the paymentagreement on an interface presented on a device of the user.
 8. A systemcomprising: one or more machine readable media having instructionsstored thereon; and one or more hardware processors configured to, inresponse to execution of the instructions, cause the system to performoperations comprising: receiving, at a payment service provider serverof a payment service provider that is distinct from a merchant server ofa merchant a payment request associated with a transaction between auser and the merchant, the payment request being received from themerchant server in response to the user making a particular userselection on a user interface of a merchant site provided by themerchant server; and automatically and without requiring userintervention, attempting to process, by the payment service providerserver, the payment request to cause transfer of funds to a merchantaccount of the merchant, the receiving of the payment request and theattempting to process the payment request both being in response to theparticular user selection and being performed on the user interface ofthe merchant site without directing the user to a service provider siteof the payment service provider such that the payment request isreceived and attempted for processing by the payment service providerserver based on user interaction with the merchant site instead of beingbased on user interaction with the service provider site.
 9. The systemof claim 8, wherein the operations further include: verifying, by thepayment service provider server, that the payment request complies withterms of a payment agreement established between the merchant and theuser; and wherein the attempting to process the payment request is inresponse to verifying that the payment request complies with the termsof the payment agreement.
 10. The system of claim 9, wherein theoperations further comprise identifying the payment agreement for theverifying using a unique identifier included in the payment request. 11.The system of claim 9, wherein the payment agreement defines termsincluding an authority granted by the user to the payment serviceprovider to make payments to the merchant on behalf of the user.
 12. Thesystem of claim 9, wherein the verifying that the payment requestcomplies with the terms of the payment agreement includes performing oneor more verification operations selected from a group of verificationoperations consisting of: verifying that processing the payment requestdoes not exceed an authority granted by the user; verifying thatprocessing the payment request would not exceed a maximum payment amountset by the user; verifying that processing the payment request would notexceed a maximum number of payment requests processed over apredetermined time period; verifying that the payment request is inconnection with a product or service for which the payment serviceprovider is authorized to make a payment; and verifying that the paymentrequest is in connection with a product or service for which the paymentservice provider is authorized to make a payment.
 13. The system ofclaim 9, wherein the operations further comprise: receiving, at thepayment service provider server a relationship request to establish, atthe payment service provider server, the payment agreement between themerchant and the user prior to any transactions between the merchant andthe user; and establishing the payment agreement between the merchantand the user, the establishing of the payment agreement comprisinglinking the payment agreement with one or more accounts maintained atthe payment service provider selected from a group of accountsconsisting of: the merchant account of the merchant; and a user accountof the user.
 14. The system of claim 9, wherein the operations furthercomprise, in response to the attempt being unsuccessful, sending anotification to the merchant server indicating that the attempt wasunsuccessful.
 15. One or more non-transitory machine-readable mediahaving instructions stored thereon that, in response to execution by oneor more hardware processors, cause a system to perform operations, theoperations comprising: receiving, at a payment service provider serverof a payment service provider that is distinct from a merchant server ofa merchant, a payment request associated with a transaction between auser and the merchant, the payment request being received from themerchant server in response to the user making a particular userselection on a user interface of a merchant site provided by themerchant server; verifying, by the payment service provider server, thatthe payment request complies with terms of a payment agreementestablished between the merchant and the user; and in response toverifying that the payment request complies with the terms of thepayment agreement, automatically and without requiring userintervention, processing, by the payment service provider server, thepayment request to cause transfer of funds to a merchant account, thereceiving of the payment request, the verifying of the payment request,and the processing of the payment request all being in response to theparticular user selection and being performed on the user interface ofthe merchant site without directing the user to a service provider siteof the payment service provider such that the payment request isreceived, verified, and processed by the payment service provider serverbased on user interaction with the merchant site instead of being basedon user interaction with the service provider site.
 16. Themachine-readable media of claim 15, wherein the operations furthercomprise identifying the payment agreement for the verifying using aunique identifier included in the payment request.
 17. Themachine-readable media of claim 15, wherein the payment agreementdefines terms including an authority granted by the user to the paymentservice provider to make payments to the merchant on behalf of the user.18. The machine-readable media of claim 15, wherein the verifying thatthe payment request complies with the terms of the payment agreementincludes performing one or more verification operations selected from agroup of verification operations consisting of: verifying thatprocessing the payment request does not exceed an authority granted bythe user; verifying that processing the payment request would not exceeda maximum payment amount set by the user; verifying that processing thepayment request would not exceed a maximum number of payment requestsprocessed over a predetermined time period; verifying that the paymentrequest is in connection with a product or service for which the paymentservice provider is authorized to make a payment; and verifying that thepayment request is in connection with a product or service for which thepayment service provider is authorized to make a payment.
 19. Themachine-readable media of claim 15, wherein the operations furthercomprise: receiving, at the payment service provider server arelationship request to establish, at the payment service providerserver, the payment agreement between the merchant and the user prior toany transactions between the merchant and the user; and establishing thepayment agreement between the merchant and the user, the establishing ofthe payment agreement comprising linking the payment agreement with oneor more accounts selected from a group of accounts consisting of: themerchant account of the merchant; and a user account of the user. 20.The machine-readable media of claim 19, wherein the relationship requestis received in response to a selection by the user of a link toestablish the payment agreement on an interface presented on a device ofthe user.